Blog

Fellow REOPros.  If you complete BPOs, I offer a way to calculate what your minimum fee should be instead of just taking low ball offers for your hardwork.  Here is the spreadsheet I use below.  This is for residential properties only.  I have attached the spreadsheet to this post.  Download it if you like.  And if the spreadsheet comes out less than $50.  I use $50 as my rate for exterior drive by.  For interiors my minimum is $75.  Thanks.

1)  Open a spreadsheet.

2)  In cell A1, type in Minimum hourly rate, in cell C1, place your minimum hourly rate, say $25 or $30 or whatever rate use so choose.

3)  Now take the address of the offered BPO location and go to Google Maps and look up the distance and time from your base location(Office, Home).  Write them down.

4)  In cell A2, type in Travel time, enter the travel time from Google Maps cell B2.

5)  In cell A3, type in Round trip, enter the number 2 in cell B3.

6)  In cell A4, type in Total travel time, enter the following formula in B4.  Formula  =B2*B3

7)  In cell A5, type in Desk time, in B5 enter (with 2 decimal places, x.xx), Say for this example this is 1.25.

8)  In cell A6, type in Total BPO time, in C6, put the following formula, Formula =B4+B5

9)  In cell A7, Dollars for travel time and desk time, In cell C7 put the following formula,     

Formula =C1+C6

10) In cell A8, type Mileage from Google Maps, enter travel distance from Google Maps in cell B8.

11)  In cell A9, type in Round trip, enter the number 2 in B9

12)  In cell A10, type in Total mileage roundtrip, enter the following formula in B10, Formula =B8*B9.

13)  In cell A11, type in IRS current mileage rate, in B11 enter the current rate, 2017 rate is 0.535

14) In cell A12, type in Total mileage dollars, in cell B11 enter the following formula, Formula =B10*B11

15) In cell A13, type in BPO compensation, in cell C13 enter the following formula, Formula =C7+C12

BPO%20Compensation%20Calculator.xlsx

After the election I started watching Bloomberg TV instead of the news/opinion channels I had been watching.  I guess I just got tired of all the yelling, in addition to the fact that I felt the need to try and get some clarity on what might happen to the economy, and more specifically the Silicon Valley housing market.

Besides the much needed civility I found on Bloomberg, I quickly came away with the understanding that no matter who the different reporters and commentators said they thought would be winners and losers in a new political environment, there was one thing everyone agreed on. Interest rates are going up. PERIOD, end of story. Janet Yellen was going to raise interest rates anyway, due to the favorable economic environment. But added to what would have happened, regardless of the election outcome, everyone agrees that we appear to be headed for an inflationary period.

I am old enough to have purchased my first home when interest rates were 19% and the most valuable homes were those that had assumable mortgages as 13% or less. Hopefully we are not going back to those days.

But we are going from interest rates in low 3% to now over 4% and presumably still rising. So what does this mean to the Silicon Valley housing market?

Common wisdom is that as interest rates go up housing prices go down since the ability for a borrower to pay also goes down. We have seen this in the past, but the decrease in price is not always proportional to the increase in rate.

Take this example.

A Million dollar loan: 30 year fixed

At 4.150%:  $4861 a month

At 5%:  $5368

At 6%:  $5996

At 7%:  $6653

The difference for each jump of 1% in interest translates into about a 10% increase in monthly payment.

For a conforming loan of $400,000 30 year fixed

At 4%:  1910

At 5%:  2147

At 6%:  2398

At 7%:  2661

Again, the difference for each 1% in increased interest rates equates to about a 10% increase in monthly payment.

So, in order to make waiting a money saver, If interest rates go up 1% pt. housing prices must go down over 10%. At a 2% pt hike housing prices must go down over 20%, and at a 3 pt climb they must go down over 30%.

Do we expect this to happen in the Silicon Valley housing market in the near future?

No one can say for sure, but let’s look back at housing rate drops during the big crash of 2008-2010/2011 in some different neighborhoods.

These are average prices for all residential real estate. Some segments fell more than others, but on average I looked at what the mean sale was for single family homes, town homes and condos in four locations: Palo Alto, East Palo Alto, 94087 (Sunnyvale west of El Camino), and Willow Glen.

Palo Alto: 

High before crash:  $1.3 million

Low after crash       $1.2 million

East Palo Alto

High before crash:   $628,000

Low after crash:       $295,000

94087

High before crash:    $779,000

Low after crash:        $717,000

Willow Glen: 

High Before crash:     $793,000

Low after crash:         $637,000

What so these numbers tell me about the Silicon Valley housing market, and by extension you?

If you are planning on buying in one of the areas where prices held up fairly well during the crash, then waiting for prices to drop as interest rates rise may not be to your advantage.

If you are planning on buying in a location that did not hold up well during the crash then an increase in interest rates may get you some savings in the long run or maybe bigger, better property.

My only concern would be that places like East Palo Alto that suffered so badly during the crash may not drop as much with higher interest rates since the location is so convenient to Facebook and Google. That may put enough pressure on these east of 101 neighborhoods to keep the prices supported more than they were in the crash.

I believe the same may be true in San Jose as companies like Google and Apple move south where there is more available space. In neighborhoods like Alum Rock or South San Jose where there is a lot of investor activity it may be better to wait until prices fall.

If you have any questions about buying or selling a home in the Silicon Valley please feel free to contact me.

Thousands of homes Foreclosed; Can you afford a Risky Loan?

The adjustable rate mortgage has been around for a number of years and it has helped a number of people afford the purchase of their first home. However, in the late 90’s and early part of the 2000’s some people took advantage of the low rates offered by ARMS and got in over their head. Before buying a home people should really look at all the factors involved with an adjustable rate loan and make sure it is right for them.

Fixed Period Varies

The vast majority of current ARM’s offer a well-defined period in which the interest rate is fixed. The defined period typically lasts from 3 to 7 years and can be as long as 10 years. After this defined period the interest rate will adjust based on the index used to calculate the interest rate.

Some people have well defined plans and can use the fixed period for meeting their goals. For instance, a military couple that has an assignment to a particular area could purchase a home using a 5 year ARM and use the time to live in the home with no worries about a change in interest rate.

However, people that are just looking at the low rates of the ARM’s and “hoping” that their income will rise in future years are taking a big gamble.

Rates Will Rise

Years ago when the ARM was first introduced it was always explained the same way. When the market took a dip the interest rate would lower accordingly and the opposite would happen when the market improved. However, the last few years have seen nothing but historically low rates. Getting an adjustable rate loan now ensures one thing; the interest rate will rise once the fixed period ends. The current rates cannot get much lower.

Thankfully, an adjustable rate mortgage will have some safeguards to protect borrowers. The amount of increase for the rate is usually capped each year as well as a cap for the duration of the loan. For instance, most ARM’s will not adjust more than 1% in one year and no more than 5% or 7% over the course of the loan. However, a 5% increase in rate on a $250,000 loan can increase a loan payment by over $700. Keep in mind that when the interest rate adjusts the new payment is factored over the remaining loan term. This can drive up the payment as well.

Plan Accordingly

All of this information points to one simple fact. People considering an adjustable rate loan need to plan accordingly. You should have some type of exit strategy in mind, whether it is selling or refinancing or paying off the loan in order to avoid some potentially hazardous conditions in the near future.

1. WHEDA Home Loan Mortgage Rates at Historic Low I receive daily updates on current mortgage rates in the...
2. Rising Rents Provide More Reasons to Buy a Home Rising Rents Provide More Reasons to Buy a Home The...
3. New WHEDA Loan Programs Are you a first-time buyer? Do you want an affordable...
4. 7 Key Questions to ask about your Mortgage Key Questions to Ask About Your Mortgage This week I...
5. Fannie Mae: Qualifying for interest-only loans tougher Thanks to the Wisconsin Realtors Association for bringing this to...

New Employment Numbers has Negative Impact on Mortgage Rates

The recent good news for the job market had a less than desired effect on mortgage rates. Thanks to signs of an improvement in the economy the recent reports stating more people are back to work had an almost immediate impact on trading in the stock market. For years economists have pointed out the inverse relation between home mortgage rates and the general health of the economy. Usually, when investors are worried about risk, they will avoid the stock market and invest more money in to bonds and mortgage backed securities. This flow of cash makes the rates drive lower. However, when times are good and investors rush to the stock market, the opposite effect is felt.

But the Sky is Not Falling

However, this does not mean that any improvement in the stock market will automatically push mortgage rates up. And it also does not mean that the mortgage rates will move dramatically one way or the other. For example, back in the year 2007 the average 30 fixed rate hovered between 6.325% and 6.625%. Now, for the past 3 months, the average rate has moved between 4.345% and 3.875%. This shows roughly a 2% change in rates over the course of 5 years. Mortgage rates do move with the ebb and flow of the economy, but it is rare to see drastic jumps or drops.

What Does this Mean for Homeowners and Potential Homebuyers?

If the economy continues to slowly improve, this means that we may indeed have seen the lowest rates ever. Homeowners that have been wavering between refinancing and hoping for a slightly better rate would be well advised to lock in a rate suitable for their needs.

At the same time, potential homebuyers who are wondering if rates could possibly get any lower may wish to go ahead and put out a contract on a home. Locking in a good rate now for 30 or 60 days could provide a small cushion against any small uptick that will likely come in the next few weeks.

Locking in a Loan

Fortunately, the costs for doing a mortgage loan are still relatively low. Combined with the modest amount to lock in a loan, this is a great time to secure a solid rate. Most lenders are seeing quite a bit of pressure to keep the costs down so it is highly unlikely that the expense of ate locking will jump any time soon. Keep in mind that the current rates are around 3.875%. Rates cannot go to zero because that would mean the lenders are not making any money. Sooner or later, rates will go back up. How high will they go? That is the proverbial “big question” that no one really has an answer for at the moment. Better to get in on the low rates while you can rather than kicking yourself for waiting and missing out.

Original Post - Mortgage Rates Rise on new Employment Numbers

30-year fixed-rate mortgage: Averaged 4.95 percent with an average 0.6 point for the week ending February 24, 2011, down from last week when it averaged 5.0 percent. Last year at this time, the 30-year FRM averaged 5.05 percent. .

The 15-year fixed-rate mortgage: Average 0.7 point, down from last week when it averaged 4.27 percent. A year ago at this time, the 15-year FRM averaged 4.40 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.8 percent this week, with an average 0.6 point, down from last week when it averaged 3.87 percent. A year ago, the 5-year ARM averaged 4.16 percent.

One-year Treasury-indexed ARMs: Averaged 3.40 percent this week with an average 0.6 point, up from last week when it averaged 3.39 percent. At this time last year, the 1-year ARM averaged 4.15 percent.

Freddie Sayz
Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac

Fixed mortgage rates eased again this holiday week amid mixed inflation data reports. Although the core consumer price index for January rose slightly above the market consensus, house prices fell 4.1 percent in the fourth quarter of 2010 compared to the same period in 2009, according to the S&P/Case-Shiller National Index In addition, the level of the index was the lowest since the fourth quarter of 2002

Low mortgage rates and home prices are sustaining affordability in the housing market. Existing home sales rose for the third consecutive month in January and were at the strongest pace in eight months, the National Association of Realtors reported; only the Northeast region experienced a slowdown in sales

30-year fixed-rate mortgage: Averaged 5.0 percent with an average 0.7 point for the week ending February 17, 2011, down from last week when it averaged 5.05 percent. Last year at this time, the 30-year FRM averaged 4.93 percent.

The 15-year fixed-rate mortgage: Averaged 4.27 percent with an average 0.7 point, down from last week when it averaged 4.29 percent. A year ago at this time, the 15-year FRM averaged 4.33 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.87 percent this week, with an average 0.6 point, down from last week when it averaged 3.92 percent. A year ago, the 5-year ARM averaged 4.12 percent.

One-year Treasury-indexed ARMs: Averaged 3.39 percent this week with an average 0.6 point, up from last week when it averaged 3.35 percent. At this time last year, the 1-year ARM averaged 4.23 percent.

Freddie Sayz

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac

Fixed mortgage rates eased slightly this week and continue to be very affordable. Prior to 2009, interest rates for 30-year fixed-rate mortgages had never been at 5 percent since our survey began in April 1971. In both 1981 and 1982, the rates were over three times as high as they are today.

The housing market is struggling to regain traction despite still historically low rates. New construction on one-family homes dipped slightly in January to an annualized pace of 413,000 units, which was the fewest number since May 2009. In addition, homebuilder confidence didnt improve for the third consecutive month in February.

Related Articles

 FHA Offers Short Refi Program For Underwater Homeowners

Rent vs Buy End Of Year 2010

A Recent Survey: Is It Time To Buy Rental Property

Mortgage Bankers Association for the week of 2/16/2010

Related Articles

The Politics of Housing

Apartment Renter Demographics and What They Mean to You.

NARPM Green Landlording Survey 

30-year fixed-rate mortgage: Averaged 5.05 percent with an average 0.7 point for the week ending February 10, 2011, up from last week when it averaged 4.81 percent. Last year at this time, the 30-year FRM averaged 4.97 percent.

The 15-year fixed-rate mortgage: Averaged 4.29 percent with an average 0.7 point, up from last week when it averaged 4.08 percent. A year ago at this time, the 15-year FRM averaged 4.34 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.92 percent this week, with an average 0.6 point, up from last week when it averaged 3.69 percent. A year ago, the 5-year ARM averaged 4.19 percent

One-year Treasury-indexed ARMs: Averaged 3.35 percent this week with an average 0.6 point, up from last week when it averaged 3.26 percent. At this time last year, the 1-year ARM averaged 4.33 percent.

Freddie Sayz

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac

Long-term bond yields jumped on positive economic data reports, which placed upward pressure on mortgage rates this week.

For all of 2010, nonfarm productivity rose 3.6 percent, the most since 2002, while Januarys unemployment ate unexpectedly fell from 9.4 percent to 9.0 percent. Moreover, the service industry expanded in January at the fastest pace since August 2005. As a result, interest rates on a 30-year fixed-rate mortgage rose to the highest level since the last week in April 2010

Related Articles
FHA Offers Short Refi Program For Underwater Homeowners
Filling The Vacancy
Maximizing The Rent refi, arms, Interest Rates, loan

30-year fixed-rate mortgage: Averaged 4.80 percent with an average 0.7 point for the week ending January 27, 2011, up from last week when it averaged 4.74 percent. Last year at this time, the 30-year FRM averaged 4.98 percent.

The 15-year fixed-rate mortgage: A veraged 4.09 percent with an average 0.7 point, up from last week when it averaged 4.05 percent. A year ago at this time, the 15-year FRM averaged 4.39 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: A veraged 3.70 percent this week, with an average 0.7 point, up from last week when it averaged 3.69 percent. A year ago, the 5-year ARM averaged 4.25 percent.

One-year Treasury-indexed ARMs: A veraged 3.26 percent this week with an average 0.6 point, up from last week when it averaged 3.25 percent. At this time last year, the 1-year ARM averaged 4.29 percent. 

Freddie Sayz

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.

Mortgage rates followed bond yields a little higher this week amid positive data reports from  The Conference Board that suggest the economy is strengthening. The index of leading indicators rose 1.0 percent in December, nearly twice that of the market consensus forecast and represented the sixth consecutive monthly increase, according to the Board. They also reported a stronger gain in consumer confidence for January, rising to an eight-month high. In addition, the share of households who said jobs were plentiful rose to the highest level since May 2009.

Consumer demand in the housing market is also showing some positive gains. Sales of  existing homes  rose in December to the strongest pace since May and sales of  new homes jumped to the highest since April. At their current sales rate, the expected time on the market fell from 9.5 to 8.l months for existing houses and fell from 8.4 to 6.9 months for new home

 Related Articles

Commercial Property: Money Becoming Available

A Recent Survey: Is It Time To Buy Rental Property

Section 8 : An Owners Guide

Related Articles

FHA Offers Short Refi Program For Underwater Homeowners

Good News! MBAA New Forebearance Program

Filling The Vacancy

Mortgage Bankers Association for the week of 01/12/2010

Market Composite Index: (loan application volume) increased 2.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 47.5 percent compared with the previous week

Refinance Index: increased 4.9 percent from the previous week. The seasonally adjusted Purchase Index decreased 3.7 percent from one week earlier

Purchase Index: increased 41.9 percent compared with the previous week and was 10.5 percent lower than the same week one year ago. The four week moving average for the seasonally adjusted Market Index is down 5.3 percent. The four week moving average is down 1.0 percent for the seasonally adjusted Purchase Index, while this average is down 7.5 percent for the Refinance Index.

Refinance Share of Mortgage Activity: increased to 72.1 percent of total applications from 71.0 percent the previous week

Arm Share: decreased to 4.9 percent from 5.0 percent of total applications in the previous week.

MBA outlook: (Excerpted from mbaa.org)

The financial markets response to the announcement of QE2 on November 3 has likely been a disappointment to the Fed. Equity prices have risen, but long-term rates have backed up considerably, with the yield on the 10-year Treasury pushing up past 3%. And turmoil in Europe has led to an increase in the value of the dollar in exchange markets, not the decline that had been expected in response to QE2. Had the Feds proposal for renewed large-scale asset purchases been well received, Fed officials might now be considering increasing the announced rate of purchases to $100 billion per month or more. But dong so under present circumstances would likely evoke a political firestorm.

The percentage of loans on which foreclosure actions were started during the third quarter was 1.34 percent, up 23 basis points from last quarter and down eight basis points from one year ago. The percentage of loans in the foreclosure process at the end of the third quarter was 4.39 percent, down 18 basis points from the second quarter of 2010 and down eight basis points from one year ago. The seriously delinquent rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 8.70 percent, a decrease of 41 basis points from last quarter, and a decrease of 15 basis points from the third quarter of last year.

We expect that mortgage originations will decrease to $967 billion in 2011, the lowest level of originations since 1997. This is a decline from $1.5 trillion in 2010 and a little under $2.0 trillion in 2009. Purchase originations should increase to $615 billion in 2011 up from $473 billion in 2010. Refinance originations, primarily impacted by the level of mortgage rates, are expected to drop sharply in 2011 to $352 billion and fall further in 2012 to $237 billion. We expect that the refinance share of originations should fall from 69 percent in 2010 to 36 percent in 2011, and then 24 percent in 2012 as rates climb above the 6 percent mark.

Related Articles

Good News! MBAA New Forebearance Program

Mortgage Glossary

Mortgage Rates and Home Prices

30-year fixed-rate mortgage: Averaged 4.71 percent with an average 0.8 point for the week ending January 13, 2011, down from last week when it averaged 4.77 percent. Last year at this time, the 30-year FRM averaged 5.06 percent.

The 15-year fixed-rate mortgage: Averaged 4.08 percent with an average 0.7 point, down from last week when it averaged 4.13 percent. A year ago at this time, the 15-year FRM averaged 4.45 percent

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.72 percent this week, with an average 0.7 point, down from last week when it averaged 3.75 percent. A year ago, the 5-year ARM averaged 4.32 percent.

One-year Treasury-indexed ARMs: Averaged 3.23 percent this week with an average 0.6 point, down from last week when it averaged 3.24 percent. At this time last year, the 1-year ARM averaged 4.39 percent

Freddie Sayz
Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.

Bond yields drifted lower following the release of the December employment report , which was weaker than the market consensus forecast and implied that the labor market is still in a sluggish recovery. Fixed mortgage rates followed bond yields lower for a second consecutive week, bringing them to a four-week low.

In its January 12th regional economic review, the Federal Reserve noted that activity in residential real estate and new home construction remained slow across all Districts over the last two months of 2010 due to concerns about the pace of economic recovery, especially in employment. In addition, the outlooks for residential real estate were mixed, with contacts in most Districts described as expecting continued weak conditions

Related Articles
FHA Financing Now Available For REO Properties
Short Sellers And The Forclosed Catch A Break
NARPM Green Landlording Survey

Mortgage Bankers Association for the week of 01/12/2010

Market Composite Index: (loan application volume) increased 2.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 47.5 percent compared with the previous week

Refinance Index: increased 4.9 percent from the previous week. The seasonally adjusted Purchase Index decreased 3.7 percent from one week earlier

Purchase Index: increased 41.9 percent compared with the previous week and was 10.5 percent lower than the same week one year ago. The four week moving average for the seasonally adjusted Market Index is down 5.3 percent. The four week moving average is down 1.0 percent for the seasonally adjusted Purchase Index, while this average is down 7.5 percent for the Refinance Index.

Refinance Share of Mortgage Activity: increased to 72.1 percent of total applications from 71.0 percent the previous week

Arm Share: decreased to 4.9 percent from 5.0 percent of total applications in the previous week.

MBA outlook: (Excerpted from mbaa.org)

The financial markets response to the announcement of QE2 on November 3 has likely been a disappointment to the Fed. Equity prices have risen, but long-term rates have backed up considerably, with the yield on the 10-year Treasury pushing up past 3%. And turmoil in Europe has led to an increase in the value of the dollar in exchange markets, not the decline that had been expected in response to QE2. Had the Feds proposal for renewed large-scale asset purchases been well received, Fed officials might now be considering increasing the announced rate of purchases to $100 billion per month or more. But dong so under present circumstances would likely evoke a political firestorm.

The percentage of loans on which foreclosure actions were started during the third quarter was 1.34 percent, up 23 basis points from last quarter and down eight basis points from one year ago. The percentage of loans in the foreclosure process at the end of the third quarter was 4.39 percent, down 18 basis points from the second quarter of 2010 and down eight basis points from one year ago. The seriously delinquent rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 8.70 percent, a decrease of 41 basis points from last quarter, and a decrease of 15 basis points from the third quarter of last year.

We expect that mortgage originations will decrease to $967 billion in 2011, the lowest level of originations since 1997. This is a decline from $1.5 trillion in 2010 and a little under $2.0 trillion in 2009. Purchase originations should increase to $615 billion in 2011 up from $473 billion in 2010. Refinance originations, primarily impacted by the level of mortgage rates, are expected to drop sharply in 2011 to $352 billion and fall further in 2012 to $237 billion. We expect that the refinance share of originations should fall from 69 percent in 2010 to 36 percent in 2011, and then 24 percent in 2012 as rates climb above the 6 percent mark.

Related Articles

Good News! MBAA New Forebearance Program

Mortgage Glossary

Mortgage Rates and Home Prices

Related Articles

The Politics of Housing

Tenant Screening Tips and Tricks

Tenant Screening - The Process

30-year fixed-rate mortgage: Averaged 4.86 percent with an average 0.8 point for the week ending December 30, 2010, up from last week when it averaged 4.81 percent. Last year at this time, the 30-year FRM averaged 5.14 percent.

The 15-year fixed-rate mortgage: Averaged 4.20 percent with an average 0.8 point, up from last week when it averaged 4.15 percent. A year ago at this time, the 15-year FRM averaged 4.54 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.77 percent this week, with an average 0.7 point, up from last week when it averaged 3.75 percent. A year ago, the 5-year ARM averaged 4.44 percent.

One-year Treasury-indexed ARMs: Averaged 3.26 percent this week with an average 0.6 point, down from last week when it averaged 3.40 percent. At this time last year, the 1-year ARM averaged 4.33 percent

Freddie Sayz

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.

Interest rates on fixed mortgages and the 5 year Hybrid ARM rose slightly over the holiday week, but were still below the years highs set in the first half of 2010. For the year as a whole, 30 year fixed mortgage rates averaged just below 4.7 percent, which represented the lowest annual average since 1955 when secondary market yields on FHA mortgages were above 4.6 percent and the average price of a home was $22,000. Recent news on housing markets has been mixed. The S&P/Case-Shiller house price index fell 0.99 percent in October, in line with other reports showing a softening in house prices since mid year. Home sales continue to recover in the months following the expiration of the Home buyer Tax Credit, however, with sales of new and existing homes up 5.5 percent and 5.6 percent, respectively, in November

Realted articles

Commercial Property: Money Becoming Available

FHA Financing Now Available For REO Properties

Green Landlording

Related Articles

FHA Offers Short Refi Program For Underwater Homeowners

Good News! MBAA New Forebearance Program

Filling The Vacancy

Mortgage Bankers Association for the week of 12/8/2010

Market Composite Index:(loan application volume) decreased 0.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 22.8 percent compared with the previous week, which included the Thanksgiving Holiday

Refinance Index: decreased 1.4 percent from the previous week. This is the fourth weekly decrease for the Refinance Index which reached its lowest level since June 2010

Purchase Index: increased 1.8 percent from one week earlier. This is the third weekly increase for the Purchase Index which reached its highest level since early May 2010. The unadjusted Purchase Index increased 21.3 percent compared with the previous week and was 12.0 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 75.2 percent of total applications from 74.9 percent the previous week

Arm Share: decreased to 5.6 percent from 5.7 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org) The delinquency rate for mortgage loans on one-to-four-unit residential properties decreased to a seasonally adjusted rate of 9.13 percent of all loans outstanding as of the end of the third quarter of 2010, a decrease of 72 basis points from the second quarter of 2010, and a decrease of 51 basis points from one year ago, according to the Mortgage Bankers Association’s (MBA) National Delinquency Survey. The percentage of loans on which foreclosure actions were started during the third quarter was 1.34 percent, up 23 basis points from last quarter and down eight basis points from one year ago. The percentage of loans in the foreclosure process at the end of the third quarter was 4.39 percent, down 18 basis points from the second quarter of 2010 and down eight basis points from one year ago. The seriously delinquent rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 8.70 percent, a decrease of 41 basis points from last quarter, and a decrease of 15 basis points from the third quarter of last year. We expect that mortgage originations will decrease to $1.4 trillion in 2010 from a downwardly revised $2.0 trillion in 2009, previously estimated at $2.1 trillion. Total originations will then fall to $996 billion in 2011, the lowest level of originations since 1997. Purchase activity in 2010 will see a significant drop from 2009, although it was given a brief boost in the spring by the tax credit program, but start to recover in 2011. Refinance activity is currently being buoyed by mortgage rates that remain close to historical lows, but will fall in 2011 and 2012 as rates start to increase. Purchase originations will fall to $480 billion from $665 billion in 2009 and refinance originations will decrease to about $921 billion in 2010 from $1.3 trillion in 2009. We expect that the refinance share of originations should fall from 66 percent in 2010 to 37 percent in 2011, and then 26 percent in 2012.

Related Articles

NARPM Green Landlording Survey

A Recent Survey: Is It Time To Buy Rental Property

Section 8 : An Owners Guide

30-year fixed-rate mortgage: Averaged 4.61 percent with an average 0.7 point for the week ending December 9, 2010, up from last week when it averaged 4.46 percent. Last year at this time, the 30-year FRM averaged 4.81 percent.

The 15-year fixed-rate mortgage: Averaged 3.96 percent with an average 0.7 point, up from last week when it averaged 3.81 percent. A year ago at this time, the 15-year FRM averaged 4.32 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.60 percent this week, with an average 0.6 point, up from last week when it averaged 3.49 percent. A year ago, the 5-year ARM averaged 4.26 percent.

One-year Treasury-indexed ARMs: Averaged 3.27 percent this week with an average 0.6 point, up from last week when it averaged 3.25 percent. At this time last year, the 1-year ARM averaged 4.24 percent.

Freddie Sayz Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac. After Europe made strides in its debt situation, investors left the security of U.S. Treasury debt causing bond yields to rise and mortgage rates along with them. Interest rates for 30 year fixed mortgages are now almost a half percentage point higher than the record low set in mid November, which for a $200,000 conventional loan amounts to $50 more in monthly payments. Housing demand appears to be picking up recently. Existing pending sales jumped 10.4 percent in October to the strongest pace since April, according to the National Association of Realtors. More recently, mortgage applications for home purchases rose for the three consecutive weeks ending on December 3rd, representing a 17.7 percent increase and the strongest pace since the week of May 7th, based on figures released by the Mortgage Bankers Association Maximizing The Rent

Related Articles.

FHA Financing Now Available For REO Properties

FHA Reforms Shift The Game

Maximizing The Rent